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Glut of Foreclosed Homes Encourages Scams, Desperation

With the national foreclosure rate still climbing, some chose to live in foreclosed homes while others have been the victims of "rent skimmers," people who pretend to own a foreclosed property and scam tenants out of thousands of dollars in security deposits and fees. Special Correspondent Jeffrey Kaye reports from Los Angeles.

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  • JIM LEHRER:

    Now, speaking of housing, here's a report from California on how some people are living in homes already in foreclosure. Special correspondent Jeffrey Kaye reports from Los Angeles.

    JEFFREY KAYE, NewsHour correspondent: As a result of the explosion in home foreclosures, increasing numbers of people are living in places they have no legal right to be.

    Sometimes occupants simply ignore eviction notices. That was the case here, where sheriff's deputies came with a court order to evict a Los Angeles family from a house now owned by the bank. As family members packed up a few belongings and left, bank representatives put up "No Trespassing" signs and changed the locks.

    The eviction was arranged by real estate agent Stephanie Vitacco.

    STEPHANIE VITACCO, real estate agent: I'm going to need you to go into the kitchen and get a big bag.

  • JEFFREY KAYE:

    Vitacco manages and sells properties taken over by banks. Last year nationally, there were foreclosure filings on 2.3 million properties.

    The crisis, exacerbated by job losses, appears to be deepening. In California last month, there was one foreclosure notice for every 165 homes.

    The banks can't sell property if there's stuff or people inside, so Vitacco often spends her days driving from one house to another, making sure they're empty and secure.

    This home appeared to be vacant.

  • STEPHANIE VITACCO:

    It looks mostly empty.

  • JEFFREY KAYE:

    Vitacco posted notices, but then saw a neighbor park a car on the property.

  • STEPHANIE VITACCO:

    Excuse me. Do you live here?

  • NEIGHBOR:

    No.

  • STEPHANIE VITACCO:

    Oh, OK. You can't park here.

  • NEIGHBOR:

    Oh, yes?

  • STEPHANIE VITACCO:

    No, any cars here will be towed. This is owned by the bank.

  • JEFFREY KAYE:

    Vitacco tries to make sure the houses are locked up, but often people break in.

  • STEPHANIE VITACCO:

    They take the toilets. I don't know why they take the toilets. I don't know where all the toilets go.